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tv   Markets Now  FOX Business  December 7, 2012 1:00pm-3:00pm EST

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melissa: take a look at that. adam: another week wasted. that is how john boehner described the fiscal cliff negotiations. it is not painful until the very end of the year. how this benefits the company. adam: the note dropped 7.7%, the lowest rate since december 2008. that is just a headline. let's get to nicole petallides. the traders are reading a bit into this report. nicole: the first thing they
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noted when i came in here, a lot of them are talking about the fact that the prior month had been revised lower. the prior month which seemed like they were good news, in fact, were not as good as they seemed. they take these numbers with a grain of salt. the dow, nasdaq and s&p are mixed today. the dow is up about one third of 1%. what is interesting, this will be our third wedding week in a row. they have not been dramatic moves, but last week was pretty slots. jpmorgan and bank of america are some names on the dow that are holding on pretty nicely. the tech heavy nasdaq down one half of 1%.
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adam: a lot of people watching that jobs number. thank you very much. dennis: according to today's jobs report, the unemployment rate is down to 7.7%. the lowest level it has been to since 2007. 23 billion people are out of work or underemployed. is this a real recovery? michelle girard joins us now. thank you for joining us. >> when you see people get excited about this number or the fact it is higher than expectations, it reminds you we have gotten used to this new normal where we are not producing the number of jobs that it would take to get back to employment numbers where we were before the recession.
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i agree. we have gotten so that we share 7.7% unemployment rate. historically, that would have been something we saw really just during recessions. i do think that the economy can do better. i think we know that companies, i do still believe, our sideline, they are hesitant based on the uncertainty associated with washington and the economy. they have actually probably fallen a bit behind on the hiring they need to do. i do think we can do better than this. melissa: if we cut that this rate, it would take us nine years. is there anything we could be doing better? >> i know everybody says this, but i do think it is true.
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it is more certainty. if we get, not just a fiscal term agreement, a longer-term deal. if we were to be able to reach a longer-term deal, the grand bargain and for once and for all, put this uncertainty about taxes and spending to rest. i think that is what it would take. i think that is what would get hiring and investment back on. melissa: we saw a dip in consumer sentiment again. do you believe people are worried about the fiscal cliff? >> they are looking out what is right in front of them. we talked about this before. this is the first crack we have seen in sentiment. in the response and half of them, half of them unsolicited
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said they have been hearing about higher taxes. i do think with all of the media coverage of the fiscal cliff, consumers are starting to recognize that there is something going on. i think people are more aware. i still think those people feel like something will get done at the last minute. i think they are aware that there are some risks out there. melissa: michelle, you are fantastic. thank you so much. >> thank you. take care. adam: some people think investing sometimes is too good to be true. what is the government's (in nailing steve cohen? charlie: i do not think people are focused on the fiscal cliff. they will not be focused until
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you see the market sell off. the market believes there will be a deal. until the market trade-off -- adam: we have a guest who will be talking about that a little later on as we get closer to the end of the year. the investigation is still underway. charlie: when you see the market trade-off you watch people freak out. interesting thing about steve cohen, there is no more remarkable trader out there than this guy. say what you want to about him. if you look at his returns, i think he started in 92, one down here. he is up this year, so far, 10%. that is why the feds are after him. i have been speaking to a lot of people with the fpi. long-term returns, consistent
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and less volatility. what they do, generally, they look at returns, pretty much steady returns, not a lot of volatility. you look at steve collins return, one down year. you look at warren buffett. he destroys profits over that period of time. buffett has more volatility and returns. steve cohen well, can save book, all he does is invest in things he thinks will be good in the long run. they look at consistency. that is the beginning of this case. he is way too good. they are saying he is too good. adam: c, you have covered a ton of these insider cases, if they
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had the recording, this man would be charged. it sounds like they do not really have anything. rich: they have been trying for a long time. they put the wiretap on his phone. they really believe he runs a dirty shop. i am not saying that he is. i know what they think. they believe you cannot have this type of returns the way they are. here is the thing, he has set up a system, a foolproof system of do not ask, do not tell. you do what you do. you come to be with your ideas. do not this is fairly tell me how you got those ideas. by the way, here is the handbook that says you cannot do insider trading. how do you know that, look at the case the sec is bringing
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against him. it is basically if you read between the lines and how they describe it. that is what it sounds like. adam: it does not sound -- it does not sound like he will be the white whale. charlie: they need a flip. they believe he is too smart. i am doing a book about insider trading. listening to one of his main informants, and other fund manager for new castle, who is obviously in jail right now, those conversations are hysterical. i just cannot imagine steve cohen having those kinds of conversations. melissa: thank you so much. the federal reserve will hold a meeting next friday to talk about new regulations to u.s. operations of large foreign
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banks. they want to make sure they follow the same financial guidelines that the u.s. banks follow. interesting. fiscal cliff talk. john boehner says he is waiting for a counter offer from the white house. adam: wall street feers gauge barely pausing. our traders, are they not worried about going over the fiscal cliff quirks we are headed to the for the new york stock exchange next. ♪ twins. i didn't see them coming.
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adam: the state of nevada has gambling up. dollars. slot machines are up a whopping 11%. it is a big-time for casino operators to. they lower the cost of financing their debt. melissa: will get that across the board. this is one of those times --
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you were supposed to be my boat party. but you one money. [talking over each other] melissa: as we do every 15 minutes, let's check the markets. watching aig. nicole: we have confirmation. we told you about a consortium of chinese companies moving ahead. we now are moving forward with that. some of the names include new china trust. that is one of them. this is something we have heard about aig. they have moved forward and try to sell different assets in order to pay for $182 billion.
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this is one of those moves. you can see of arrows. up $0.63 at 33.88. dow jones industrials gaining. talk to you. melissa: thank you. adam: it was the summer of 2011. q the scary music. the summer of 2011 and worries on wall street were high. he was a man, she was a woman. [ laughter ] adam: all sending stocks lower and the vix soaring. the vix has barely budged this time around and we are on the verge of a fiscal cliff. does the market think there is going to be a deal? joining us now from the pits of the cme.
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why do you think traders and investors think we will avoid the fiscal cliff? >> i think you will have this chicken little scenario. crying this god is falling. every time before a crisis materializes, they come up with something. you look at the principals in here, john boehner, president obama, timothy gardner, they do not sound like they are getting together anytime soon. adam: you think we will go over the cliff? >> i think we are very close to doing it. if they don't come up with an agreement, i do not see any advantage of being any longer then you are right now. i have a double sure production to protect me on the way down. i am protected.
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adam: what kind of things should an investor be looking for that we do have a deal? >> you know, that is really hard to say. what i would like to hear is less out of boehner and less out of obama. if i hear that there has been a call made to representative boehner to come and speak in the white house that they will get something done. then i will start thinking about getting out. nothing until then. adam: some people say if we go over the cliff, it really is ... we still have a month or two for congress to fix things. >> if we go over the fiscal cliff, it will be bad. it will be really bad for the market. ultimately, it will make its way out. we are not solving this cliff before the end of the year. we have come to gather. we have a framework.
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we are here and they are there, but we will meet somewhere in the middle. i think it will be bad for the market if they work behind the curve. adam: when do they jump in if we go over the cliff? >> waited out. you will know. the first three days, at that point, start looking at getting into positions. our economy is doing better. things are pointing to growth. hopefully washington will not screw this up. if you look at these solid companies that are out there right now, those are the ones that you buy. adam: thank you very much. have a great day. melissa: we will show you whatt3 the 401(k) for ibm means for the company. adam: shifting to a right to work state. michigan's organized labor. take a look at how the dollar is
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faring today. ♪
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>> @23 past the hour, i have your fox news minute. reuters reporting protesters have broken through military barricades in cairo egypt. president morsi spoke to the nation calling for a national dialogue. he refused to bed. japanese authorities telling the united nations no problems have been detected that nuclear plants near the epicenter of that 7.3 magnitude earthquake that walked the country today. a 1 meter tsunami in the area near honshu. there is no threat of a wide spread tsunami. the nurse has taken her own life that got caught -- the dj posed as queen elizabeth and king
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charles. those are your headlines. back now to adam and melissa. melissa: unbelievable. protests in michigan as state lawmakers approve right to work law graduation. new laws that prohibit new unions from collecting fees from non-members. mike towbin has more on this. >> they cannot stop what governor rick snyder calls freedom to work legislation from being passed on tuesday because michigan republicans simply have the numbers. the demonstrations have gotten ugly. eight people have been arrested. additional state troopers have been diploid to the capital. unlike drawnout labor standoffs we have seen in years, rick snyder has been able to slam us through the legislature during the lame duck session.
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he insists he is not picking a fight. >> it is not picking a fight. i view this as solving an issue for michigan workers. >> this does not mean that michigan democrats are about to throw in the towel. they say it is an understatement to claim that this legislation will face legal challenges. they will challenge the manner in which a legislation was pushed through so rapidly. democrats claim republicans in michigan have pulled every trick in the book. >> they have lied to us every step of the way. >> he says this is leadership. >> that is baloney. >> michigan republicans say that this legislation does not challenge reflective bargaining. all the legislation does is make optional union dues and union
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memberships with the exception of police and firefighters. stuart: thank you so much. the unions say they are getting rights for all of the workers. it is amazing to me that they are trying to compel somebody to force them to join a group. it seems to violate your liberty. adam: look at what happened in wisconsin. the membership stopped donating once it became volunteer. 75% stopped donating to their unions. melissa: that is amazing. they said people wanted to be part of the union, but the economic times are so tough and given the choice, they figured it was not worth the money. adam: it would be a question for the labor movement, what is the role in 2013. melissa: forget the better than expected jobs report. fiscal cliff worries still
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weighing down the market. adam: deal or no deal, the federal government will still be flowing through trillions of dollars we do not have. it is all about spending. next. ♪
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adam: today's jobs report beating estimates, 146,000 jobs created in november and the unemployment rate dropping to the lowest rate
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since december 2008 at 7.7%. nicole petallides on the floor of the new york stock exchange. welcome back, nicole. what's going on? >> thanks, adam and melissa. we're looking at a market holding onto some gains so that is obviously a positive sign. december is traditionally the a great month on wall street. the best month since back to 1950, s&p 500 best performing month, up 1.7%. here is as we see the divergence here's what we're seeing lately as there is so much concern about the fiscal cliff. the nasdaq is down about half a percent. the dow down half a percent. s&p also gaining. dow jones industrials up 59 points. some names leading the you way include caterpillar and jpmorgan. pulling other the way way, microsoft, verizon. the jobs report, everybody takes it what it is. they're well aware of revisions for the prior month which were not as good
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as they first appeared. back to you. adam: nicole, thank you very much. we'll see you in 15 minutes. melissa: speaker of the house john boehner calling the past week of negotiations over a fiscal cliff a waste. even if both sides come to a deal the federal government will still be spending trillions of dollars a year with no tax plan to match it. rich edson joins us with more on this depressing story. rich? >> right. you know even if you were to somehow find the trillions of dollars you're looking for we're still out of balance. a large piece of the fiscal cliff is $94 billion in automatic government spending cuts over the next year. part of a trillion dollars in federal cuts over the next decade though even with these cuts the federal government is still projected to spend more each year over the next decade. to put this in perspective, one former cbo director says the costs of hurricane sandy could easily wipe out most of next year's savings. >> with a trillion dollar deficit right now. so if you cut 94 billion and nothing else changes you
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barely dented the deficit. the other programs are growing. we'll not see spending decline. in fact we'll likely have a emergency spending bill for sandy that is 60 billion. 94 is gone right there. >> even with a trillion dollars in cuts federal spending is on the way up every year starting with 3.5 trillion this fiscal year. nearly 3.6 trillion in 2014. 4 trillion by 2016 and 5 trillion by 2021. the cbo says even allowing 5 trillion in tax increases to hit the economy the next decade the federal government still spends $2.3 trillion more than it takes in. back to you. melissa: oh, rich edson thanks so much. adam: you think with the physical problems the country faces zooming at us like a 1959 he had sell going at us on a one way treat there would be sense of urgency. president obama has no meetings, no public appearances on the issue planned at least so far today.
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brad blakeman is not surprised. he says it is a clear sign we're going to go straight over the fiscal cliff. blakeman is a professor at georgetown and also a former deputy assistant to president george bush. he joins us now and what do you think is the best argument that why the president would allow us or congress would allow us to take the plunge? >> i think the president believes the polls he is seeing within the white house if we do go over the fiscal cliff, people will not blame the president. they will blame republicans. i happen to not believe that at all. the buck should stop with the president and he should exercise leadership especially after a close election where we have the status quo. he still controls the white house. republicans the house and democrats the senate. it takes three to tango in washington, the white house, the senate and the house yet the president refuses to engage seriously with the leaders. you get on the telephone and speak to boehner when you're less than a mile apart in distance is showing that the president doesn't seem to concerned about driving us off the cliff. adam: so why has he not had
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john boehner come to the white house? he did that secretly when vice president biden was negotiating with eric cantor two years ago. he met privately with boehner. why don't they do that again? >> because i think the president believes he is in much better political position. when we go over the cliff as matter of law the obama tax cuts expire. we have sequestration where these drastic cuts take place but the president politically knows that even if it a deal is made in january, february on spending they can be made retroactively. so the president believes he is in a much better position on spending than he is today in making a deal because any deal that they make will be retroactive. adam: let me flip your logic. do you think politically i don't think it would be good economically, politically good for the republicans to call the bluff, go over the cliff. yes, there is short-term pain come 2014, midterm's election the president's economy. the president gets responsibility for what happens after the cliff
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drops. wouldn't that be the political move to make if you're john boehner? >> we really have no choice. president is in the driver's seat and boehner is hostage in the back seat with the president with his foot on the gas. nothing the speaker can do, other than perhaps, i think it would be politically wise for the house to pass a bill with the majority now. put it back in the president's court. there is really not much, house can do against the senate and white house to get anything accomplished. adam: so you think we go off the cliff. do you think there would be any signs in the next week or two that that's an incorrect prediction? they're talking right now, not politely, not pleasantly, but not getting anything done but the lines of communication are open. >> look, if we're in a crisis and i believe we are, why isn't the president showing leadership and having leaders down to the white house, burning midnight oil instead of campaigning in places like pennsylvania and in arlington, virginia, speaking to the business roundtable. they are not the ones who will make the deal. it is leadership on the hill. no signs as far as i'm
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concerned that the president is engaged in his level between him and the leaders. the staffs are really from what i'm hearing on inside are really at quite a distance in making a deal. adam: what is the discussion when we bring you back on fox business say, the week of january fourth after we've gone off the cliff by your prediction? what is the discussion we'll be having? how they retroactively restore some of the cuts or there is a winner or loser with the american people? >> the president will claim he is the winner because he did everything he could. surely the schedule dictates he has a hand's off approach to the crisis. he thinks he will have more leverage in the next congress for trying to get the spending that he wants done as opposed to cuts that need to be done. adam: all right. brad blakeman, if anybody knows how washington works it certainly would be you, sir. thank you for joining us. >> thank you. melissa: big blue, the bellwether for employee benefits now says it is not paying 401(k) matches until the very end of the year. you heard about this, right? how this benefits the
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company and not employees coming up. adam: also take a look at 10 and 30-year treasurys especially if you want to go get a mortgage. ♪ ♪ [ engine revs ] ♪ [ male announcer ] oh at fun it is to ride. get the mercedes-benz on your wish list at the winter event going on now through december 31st. [ saa ] ho, ho, ho! [ male announcer ] lease a 2013 e350 for $579 a month at your local mercedes-benz dealer.
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>> i'm cheryl casone with your fox business brief. it is a mixed market in afternoon trading as investor weigh a better than expected november jobs report with a drop in consumer sentiment. the federal reserve will be holding a open board meeting december 14th to discuss and vote on regulations over the u.s. operations of large foreign banks. fed governor daniel tarullo argued in the past the regulation of foreign banks has changed relatively not much in the last decade as it needs new rules. fedex is preparing for a record-setting day of shipments on monday, readying to move more than
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200 packages a second. continued growth of online sales particularly during the fast-paced high growth holiday shopping period. sales on sigh per monday topped $1.4 billion the most lucrative day in history. that according to come score. that's the latest from from fox business network, giving you the power to prosper
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melissa: big changes coming to ibm. starting in 2013 they plan to hold back on the employee match to the employees until the very end of the year. robert gray in the newsroom. employees are getting shortchanged because they're not earning on the money in their account all that time. >> that's right. they will not be able to do some other things as well in there, melissa. after all it will cut frequency of company contributions. there will be no more
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dollar-cost averaging here. the amount may not change but effects how it is invested will definitely be felt. from twice a month, ibm will pay every new year's eve almost like a dividend for employees of record as of december 15th with the exception of retirees. look at for disadvantages for employees. no ability to dollar-cost-average. when the market tanked think about 2011 particularly after the aaa ratings dip from the u.s. markets tanked into the huge rally. you would only buy in the very end of the rally and lose a year's worth of interest and you lose money if you leave before december 15th and no longer employee of record. coming under fire from alliance at ibm affiliated with the communication workers of america. they want them to go back to twice monthly. look why ibm is doing it. hold the money longer. save on administrative costs and save money obviously if the employee leaves. this is not unheard of this paying year-end, one lump
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sum. take a look at "wall street journal" hewitt survey found they pay each pay period, weekly, monthly, quarterly, 4% do that. annually is the second biggest category. 9% of companies out there already doing it. that is the frequency. what about the match game? employers making no contributions actually went up in 2011 from to 7%. that was is surprise. take a look now at what they're paying though, those who still pay, guys, you may not notice this, they're actually paying more in 2012 than they did in 2011. i talked to the interrim president of the plan sponsor council of america. they track the data and saw some of it there. the amount now paid out is back so where it was precrisis in 2008. we know a lot of people froze or killed the match during that time period. so at least there is some good news for workers out there in terms of that retirement plan. melissa: yeah, robert gray, thanks so much. you know, that was
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immediately what i thought of when i heard this story. there were so many companies during the financial crisis that suspended the match i assumed would never come back. it was one of these things that would be dead by now. it is still around. the fact they're doing this way obviously tough on employees. still free money at end of the year. adam: but what is the message ibm is sending to employees especially close to christmas like because hum buck. i got a noose around you until next year. it will not play well with the employees, do you think? melissa: of course not. they will immediately realize what it is all about. i'm surprised more companies are not doing this. this is tough economic times out there. the job market, so many people out there looking for jobs. you don't have to pay as well and provide some benefits because people want that job no matter what. adam: we need time to have that discussion. we'll move on though. it is a quarter till as we do every 15 minutes we check markets. nicole petallides on the floor of the new york stock exchange. nicole, netflix are in
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trouble with the sec or about to dodge a bullet, right? >> they're trying hard to dodge a bullet. reed hastings and is saying what they posted on facebook broke disclosure rules according to regulators was not material. they talked about what they said on the facebook that netflix monthly viewing exceeded one billion hours for the first time ever in june. well that is something shareholders would want to know about. that is something wall street wants to know about. when it was posted on facebook it was accessible to 244,000 subscribers to that particular page. seems like the disclosure was unfair. that's why we found ourselves talking about netflix today because regulators are looking very closely into this. here is a look at netflix. shows such resiliency. up about 73 cents at 86.90. you think with this investigation and this pressure it might be to the downside but no. reed hastings is talking postively and shareholders feeling pretty good. back to you. melissa: nicole, thanks so much.
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gold bouncing back from a one-month low after today's jobs report. fox business contributor phil flynn from price futures group is in the trading pits. phil, howe are traders reacting? what are they saying about the jobs report? >> a lot of traders are still in shock here. they want to go back and reread it if that was the right report or a report from three years ago. they were definitely shocked that the market reacted. initially gold prices went down on the report because a stronger economy maybe we shouldn't be worried and not have our money in gold? we should invest in stocks. that was a little initial downward pressure. later in the day we have consumer confidence number. big drop in the month of december. that was a little disconcerting. we have what i call the fiscal cliff capade going on. john boehner nervous going into the weekend. long term still very good buy, holding above the 100 day moving average. we're seeing record amounts
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of gold going into etfs. big players are still very bullish on this market and we're hanging in there. let's move into the oil market a little bit as well. the oil market has been struggling. big supplies. we did get a bounce off the jobs report. we're back down a little bit today. and considering the fact that yes, we're way oversupplied in gasoline right now and there's a lot of supply of oil, you still have to worry about the concerns about the middle east heating up. going into a weekend i'm amazed we're not getting more of a rally off of that. back to you melissa and adam. melissa: that's a great point. phil flynn, thanks so much. adam: we have breaking news right now and this is of verying ford. ford is recalling 19,000 of 2013 fusion sedans for another -- this is the second recall for this vehicle according to "the wall street journal" here's the issue. it has to do with a coding on the lighting system in the front of the car. not the same issue that they have already recalled frd escapes and fusions, 2013 with eco-boost system because of potential for fire hazard.
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this is totally separate issue, 19,000 fusions. this car has gotten pretty big compliments from reviewers. this will be problems for ford. melissa: absolutely. adam: checking in on the smartphone. is this a smart idea? california's attorney general cracking down after concerns about privacy. melissa: i always wonder about that. if it ain't broke why fix it? the city of los angeles new parking meter law. you will not believe this one. o as you can see, geico's customer satisfactn is at 97%. o as you can see, geico's customer smmmm tasty.s at 97%. and cut! very good. people are always asking me how we make these geico adverts.
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so we're taking you behind the sces. this coffee cup, for example, is cit's not real.ed. geico's customer satisfaction is quite real though. this computer-animated coffee tastes dreadful. geico. 15 minutes could save you 15 % or more on car insurance. someone get me a latte will ya, please? you know how painful heartburn can be. for fast, long lasting relief, use doctor recommended gaviscon®. only gaviscon® forms a protective barrier that helps block stomach acid from splashing up- relieving the pain quickl try fast, long lasting gaviscon®.
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adam: the state of california is taking aim at delta airlines for not complying with privacy laws when it comes to its fly delta app. shibani joshi is covering this story. how much trouble are they in? let me ask you guys, first off. have you downloaded the delta app or even some other competitor, continental airlines and you put pretty personal information on there? adam: no. >> no? melissa: i wouldn't do it because of the personal information. >> well, for the millions of people out there who have, this is a real privacy risk that they may be encountering. some of the stuff this app requires out of you in order just to get information. your date of birth. your home address. frequent flyer number and credit card data and geolocation data so it knows wherever you are around the world. melissa: forget it. >> there were apparently no privacy clauses associated when you downloaded this app. now the california state
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attorney general is suing delta air lines for omitting this privacy policy, essentially saying users that use the delta application don't know what personally identifiable information delta collects, how delta uses the information or to whom that information is shared, disclosed or sold giving you guys very little reason to download the app now. adam: will they hit delta harder or slap up a disclaimer you can't read because it is too small. >> privacy filing. we'll see if they put it on there. the potential find could be in the multimillions of dollars. $2500 potentially for every single app downloaded. it has been downloaded millions of trials. it will be a bake wrapger. adam: delta would say, thank you, shibani and bye-bye. melissa: if you drive in los angeles keep a close eye where you park of the the city council holding up a law making it illegal to
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park in spaces with broken meters. basically you have to move your car or be willing to risk getting a ticket. transportation say the city makes 5 dal million in revenue from those tickets. the decision overrides a state law which allows drivers to park for free at broken meters up to maximum allowed time. cause vandalism. people would wreck the meters to park there. a total disincentive for city to fix the meters. adam: if you have a stylish car you can always park for free. nothing more stylish than the muppet movie, studebaker. in his natural habitat. you don't need a parking meter to work with. car nuts will love this. a bit of history hits the auction block. a original 1963 studebaker avanti in the scottsdale, arizona the week of january 18th. this car in particular was the fourth produced and comes off the south bend
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assembly line with an original 289 supercharged v-8. this marks the 50th anniversary of the production. it all began with 63 model year. -phas the tangerine interior. it was car believed to be shipped for new york city for publicity purposes. studebaker shut down in south bend and united states in december '63. produces cars in ontario, canada till '66. everybody case, pgb, set up, because studebaker terminated employee pensions. i lived in south bend. you have to love studebakers. melissa: looks very "mad men". i love it. tonight on "money", peter morici, and ian shepherd son, and jonathan hoenig, i love him, they will join me for a money power panel. we'll talk jobs numbers and whether the platinum coin option could solve the debt crisis problem, maybe even
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ibm's 401(k) plan, who knows. that is 5:00 p.m. eastern on fox business. adam: bring the pictures back up, those three would look stylish in a studebaker. melissa: that's right. adam: coming up with year-end tax changes about to take place is now the time to convert to a roth ira? tracy byrnes and ashley webster break it down with a tax expert next on fox business. you don't want to miss this one. [ male announcer ] this is steve. he loves risk. but whether he's climbing everest, scuba diving the great barrr reef with sharks, or jumpininto the marke he goes with pele he trusts, which is why he trades with a company that doesn't nickel and dime him with hidden fees. so he can worry about other things, like what the market is doing and being ready, no matter what happens, which isn't rocket scice. it's just common sense, from td ameritrade.
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tracy: happy friday, i'm tracy byrnes. ashley: i'm ashley webster. wall street takes on the jobs report and not really impressed up 50 points. more americans simply giving up on trying to find one. that's disturbing. ftn economist lindsey piegza will be here to help us break down the numbers straight ahead. tracy: if you thought this was the week for progress on
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the fiscal cliff. well, think again. big ol' zero. nothing happens. house speaker boehner says it is clear president obama is dragging the economy well over the cliff. ashley: the rhetoric goes on. ibm playing scrooge to hundreds of thousands of employees by radically changing its 401(k) contribution. is your company next? tracy: kind of scary. as we do every 15 minutes we head down to the floor of the new york stock exchange, nicole petallides. they are climbing back to session highs although the notion 48 points up is only thing we've got, doesn't say much. >> it has been a slow crawl but this is our third week in a row of gains. it doesn't feel like it's been a great three weeks but hey, if you're long the market and you're bullish you will take a winning week after a winning week, whether 3% or .1 of 1%. the dow is up roughly 100 points for the week. the dow is up 46 points.
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we haven't seen three consecutive gains for the dow since august. that is some good news. what is interesting about the data we've been getting, got it in the monthly jobs report, so important and shows sooe, it was better than expected, and yet on the other hand, traders i was talking to talked about this, consumer sentiment is terrible terrible. they don't feel like economy set abouting better. how is the unemployment report improving while consumer sentiment is not? that's where you see the disconnect. jpmorgan one of best performers on the dow jones industrials. caterpillar, wal-mart, ibm are some of the names helping the dow keep afloat. thank you. ashley: thank you, nicole. real mixed bag of economic data today. if you dig down a little bit like the jobs report, we're going to talk about this now. shows the u.s. companies added more jobs than expected but the number of americans giving up on finding work also rising. .
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that is the disturbing part. senior washington correspondent peter barnes at white house to break all of this down. peter? >> that's right, ashley, people leaving the workforce helped to push the unemployment rate down unexpectedly to 7.7% in november down from 7.9% in october. that is the lowest monthly unemployment rate since 2008 and lowest rate in president obama's presidency. nonfarm payrolls rose 146,000 in november. both above expectations. a little bit of a surprise because economists were expecting that hurricane sandy, the impact of hurricane sandy which hit 25% of the u.s. population, 25 states or something like would that cut job creation andket the unemployment rate a bit, kept it higher. turns out sandy did have an impact but not on the headline numbers. >> if you look deeper in the report you see over a
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million workers who normally work full-time were reduced to part-time hours during the reference week because of bad wetter. over 300,000 additional workers weren't able to work at all because of bad weather. >> but because the way the labor department counts full-time workers part time workers and whether people work at all, and when they work, it didn't show up in the headline numbers . one thing that did, 350,000 people left the workforce in november. that was one reason again why the unemployment rate dropped to 7.7%. ashley and tracy. ashley: sounded good to begin with then you take in those factors as peter outlined, maybe not so good. peter, thank you so much. tracy: there is lot more ugly in the report and we'll talk about it now actually because there are troubling signs for the economy underneath the headline numbers. we'll bring in margie battle, senior portfolio manager director at wells fargo capital management. two things you reported are
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increase in low wages and drops in manufacturing, not good, right? >> that says that the jobs numbers is not quite as good as it needs because of the also if you looked at hours worked, look at average hourly wage just very, very slightly positive. in other words probably losing ground even versus the low rate of inflation. so not a real encouraging picture all around. ashley: margie, off the job gains more than a third was on the retail side and i would suggest that is holiday hiring of course. we had an early thanksgiving this year, this time around. not exactly suggesting a healthy recovery, is it? >> well, that's right. in addition a lot of those are part-time jobs, not permanent jobs and relatively low wage jobs and not jobs that have a professional advancement track. so just barely slogging along, a little above zero.% tracy: yet you look at three factors, right? auto, housing and the financial stocks. and all three seem to be
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doing, squeaking out some sort of gains. so that says something, right? >> well, it does say there are some sources of strength in the economy and it shows you how the american economy can really regenerate itself. car sales are on a multiwe're can -- multiyear up swing going from a negative a few years ago to a positive contributor. housing even more important that has been negative up to the last few months. and housing is important because again it is on a long sus sustained uptrend i think and also housing is a labor intensive sector. so jobs created as a result of new housing units being constructed will help increase the jobs. what wages will be is another story but at least more people working will be good. financials are good. i always like to look at financial stocks. that says something about the base lik liquidity of the financial system. this is sector under enormous pressure so stock
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prices are a good sign. ashley: looking ahead where this recovery has been painfully slow as we all know, when do you think we'll get back to what we would consider a healthy economy and a healthy job environment? >> i think it's a multiyear process ahead of us. i think it will be a slow slog. actually i look at the very, very low rates that we have right now, the treasury rates, really being a sign of the sickness of the economy. when we start to see treasury rates on a sustained upward move, that will tell me that we're going back to what used to be normal, say pre-07 to a economy growing 3 or 4%. until we start to see the fed not pushing down on rates so much we have to look for more of the same. tracy: real quickly some of the sectors you like one of them is energy. a lot of people say we have energy boom in the united states. you like the shale gas and liquids, right? >> yes because here's an industry that really has exploded in the last half a dozen years where it didn't
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previously exist. it will help to lower the cost of energy in the whole economy making our economy again more efficient than just about any other developed country and a source of real wealth as we create to build out this sector here more and more of that. margie patel, wells fargo management. ashley: 8.8 million jobs were lost as a result of financial crisis. 4.2 million have been recovered. that is less than half. unlikely weill get all of them back because companies are used to doing with less. tracy: lean and mean. ashley: more ahead on the economy and oh, yeah, that fiscal cliff. ftn economist lindsey piegza says washington is ignoring a much bigger problem than tax rates on the wealthy. she will explain just ahead. tracy: fox business exclusive for one company that saw its stock double after hurricane sandy. generac's ceo joins us ahead. look how oil is trading
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right now, basically unchanged, $86.04 a barrel. we'll be right back.
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tracy: it is time to make some money with charles payne. this hour we're looking at a california-based tech company. charles spent a lot of time in cali. >> yes.
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i'm starting to learn cali. i'm not really impressed with los angeles. i know it is a different story. ashley: not sitting in your car it's great. >> i went to the museum to see the exhibit. fantastic. anyone in l.a. should go see it. sandisk is the stock. it is a stock, we played it before. it pulled back a lot lately. i'm not sure why it pulled back so much. lately they have been doing pretty well. last night they beat the street by 46%. next year fiscal earnings estimates continue to climb. three months ago they were three bucks, now 3.48. valuation look pretty reasonable to me. i'm a volume guy. i believe like 98% of the everything that happens in the market people know ahead of time. i'm not in that clique when they buy i see the volume and i jump on the train. it is acting pretty good today. it broke key resistance yesterday. long term 45 and 50 bucks. ashley: you like this price? >> i do. you have the flash memory
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and all kind of different things go into it. it can be a very volatile stock. it is classic momentum when it gets going in one direction it is going big-time. just hope it is not the wrong direction. tracy: are you worried about insider selling? >> there has been insider selling and that worries me but not -- so funny you say that i regard insider buying a large signal and insider selling not as much a signal there is estate planning. ashley: interesting. >> sometimes you have estate planning. if someone had 10 million shares and sold 999,999, it would be a flag. people on show worked at enron and worldcom and all their money and sold a little bit of it. it a yellow flag, not a red flag. tracy: tax planning you're probably right about that. ashley: thanks, charles. of course as we do every 15 minutes let's check on the markets. the dow still hanging in there up 44 points. nicole petallides on the
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floor of the nyse. a couple names moving on legal news, nicole. >> that's right. let's start off and take a close look at aetna. when you look at aetna you see it on the move. that is because they agreed to pay out $120 million to settle some class action lawsuits per takening to some practices they had paying claims for out of network care. and, meantime jpmorgan actually raised aetna to an overweight from a neutral. to a certain extent this brings some clarity. when you have this type of thing overhanging a company or overshadowing the stock, now there's chrart. chart. this is -- another thing interesting, tracy and ashley is big lots. turns out the fbi is investigating because there is a 10 million dollar stock sale by the company ceo done ahead of a negative report. that is why the manhattan u.s. attorney with subpoena is looking to this. why would he sell ahead of
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negative reports, a $10 million stock sale? not good. number one loser in the s&p 500. back to you. ashley: all right, nicole. interesting. thanks very much. we'll be back in 15 minutes. tracy: tough new talk on the fiscal cliff. why house speaker boehner says president obama is deliberately pushing the country over it. ashley: all right. first look how the dollar is moving right now as we finish another week of trading. a mixed bag but the euro, pulling back against the dollar, below that 1.30 mark. we'll be right back.
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can. >> at 19 minutes past the hour i'm arthel neville with your fox news minute. reuters reporting protesters broke through military barricades outside the presidential palace in cairo, egypt. late yesterday defiant president morsi calling for a dialogue but refused to bend on his controversial decree. syrian rebel groups elected a unified command during a meeting. as violence continues to rage in the torn nation and fears the assad regime could use chemical west that is mounting. secretary of state hillary clinton saying today that future of syria can not
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possibly include bashar al-assad. 2,000 people gathering at pearl harbor observing the 70th anniversary of attack. in december 7, 1941 a japanese attack killed thousands of americans, thrusting the united states into world war ii. a moment of silence was observed at 7.59 a.m., exactly when the bombing began. that is the news from fox. back to you, tracy. tracy: arthel, thank you very much. the federal government will still be spending trillions of dollars a year with basically no plan to pay for it, hello. rich edson in d.c. to talk about this. you know what? nothing is really going to change, is it? >> right now congress is just trying to figure out how to replace a trillion dollars in automatic spending cuts over the next decade. even with that nearly $100 forecast to grow over the next 10 years. mostly thanks to increases
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in health care spending on medicare and medicaid. the feds are expected to spend more than $3.5 this fiscal year. nearly 3.6 trillion in 2014. 4 trillion in 2016 and 5 trillion by 2021. one former federal budget director says without controlling health care costs any budget deal will fall short. >> we'll still have a enormous amount of work to do so this is just the beginning. we'll be back to the same topic in 2013, 2014, 2015 dmls we made big changes to these programs. >> as for plans to contain spending in these deficit negotiations the white house has $600 billion in various cuts and fee increases on the table. house republicans are offering 1.4 trillion in cuts. democrats say cutting too much too quickly will stunt economic growth. back to you. tracy: doesn't take a rocket scientists to figure that one out. rich edson, thanks very much. >> thanks. ashley: you are all doom and
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gloom. tracy: skeptical. ashley: all right. our next guest says even if a compromise is reached on a fiscal cliff deal, that's a big if, serious problems with the economy will remain and it's time to ask the tough questions about the middle class. joining us now, lindsey piegza, economist with ftn financial. lindsey, as always thanks for being here. you say businesses and consumers will face hash realities next year regardless of what washington does on the fiscal cliff. what are those realities? >> right now everyone is very much focused getting a compromise done but even if we get the president's plan, even if we get the republican's plan very likely that shaves growth down to under 1% for the first half of the year. that is dismal outlook regardless whether or not we come to a compromise. that is much more positive outlook than falling off the cliff outright but still doesn't set us up for long-term growth. plus neither one of these proposes asks the tough questions of the middle class saying long term do we
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want to take on a bigger tax burden or do we want to cut the social programs? the conversation to me seems very disingenuous when we're talking about 100 trillion in unfunded liabilities and we're arguing over 800 billion in tax increases oo 2% of the population. tracy: how does this play out? we're not hearing any discussions about entitlements. no one wants to touch raising the retirement rate. i don't understand why. to me that is so simple. all we're talking about is taxes. we're not talking about spending. do you see the republicans, dare i say caving to just get this done? >> you know, that's a really difficult question because i think right now there are three clear scenarios. we go down the cliff, kick the can down the road and get some compromise of spending and tax increases. what that does set us up for another conversation six or 12 months from now. this doesn't get us further along where we need to be, getting the country back on the long term path to prosperity. ashley: we had many analysts say the market priced in we're going over the cliff.
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i don't know that i buy that. is the market really prepared for that? >> i don't think so. i think the market is anticipating some sort of compromise less than favorable growth but not necessarily recession. that we would go into if we saw the full 607 billion come out the economy but what we're already seeing businesses were anticipating this cliff, anticipating the compromise. and they're already on the sidelines. tracy: right. >> they're sitting on billions of dollars that could be put to work but they're hesitant to invest that in terms of structures, equipment or additional employees as we saw in this morning's report. tracy: consumer confidence was down. >> sure. tracy: is the consumer kind of late to the party? for a while we saw the consumer out there shopping. >> sure. tracy: now all of sudden they are getting this could be a big issue? >> businesses will respond first. when they're making a decisions this is two, five, 10-year outlook the consumer can change their spending patterns on last minute notice. tracy: right. >> as we come closer and closer to the fiscal cliff now the consumer is saying wait a minute, i'm hearing reports my taxes goo up
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additional five or 10,000 a year. i may start to temper my spending now. we're finally sighing the consume react. a good part that drove the decline in consumer confidence. ashley: talking about the jobs report, headline numbers great. we added more jobs than we thought. the unemployment rate down to a 10-year low. >> the report doesn't tell the entire story. first reaction. this is great report. double the consensus forecast. remember we only beat expectations because they were so tempered because we anticipated a negative effect from sandy. going through the different sectors aside from construction this appears this is clean report, really telling us what the underlying organ trend in the labor market is which says we're continuing to lose momentum from the initial very impressive job report at the beginning of third quarter. tracy: you say the fed will not be impressed with this kind of growth. what does that mean? >> we need 200 to 250,000 jobs on a monthly basis to
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cover demographic changes. we're talking 130,000, very much short where we need to be. this keeps the conversation similar at the fed. we may see them ramp up monthly purchases. ashley: we're out of time. lindsey off to see the bears and vikings this weekend. who will win? >> oh, i think the bears. ashley: da bears. she is a little biased. lindsey piegza economist with ftn financial. tracy: you're so great. i don't understand why anyone gets on a plane to go somewhere colder, for love of the game. tracy: no. watch it at home. when it comes to preparing for the fiscal cliff companies paying out special dividends are grabbing headlines. something else is happening out there. wealthy taxpayers are maximizing donations ahead of the fiscal cliff. president obama told business leaders it won't being eliminated but they're still talking about it. according to "the wall street journal" fidelity's charitable gift fund brought in 1.2 billion in the first
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nine months of the year. that is up more than 60% from last year. i know. people are giving. charitiessare even getting in the mix. they're ramping up collection efforts going into the end of the year. ashley: bet they are. tracy: you say what you want how philanthropic we are, it is all about the tax deduction. you take it away, it is a lot about the tax deduction. you take it away, there will be a lot of charities that are --. ashley: i'm cynical. but i agree. of course. ibm hoping to save millions of dollars by changing its 401(k) contributions. how much does it cost the employees though? gerri willis is here on that story next. tracy: as we head out to break, the dow is up 55 points. look at some winners and losers on the s&p 500. avon calling up 5.6%. and genworth financial. and big lots, as nicole mentioned earlier, your loser on the s&p 500. we'll be right back.
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it's nice to have the experience and commitment to go along with you. keep dreaming. keep doing. go long. ♪ ashley: it is pretty. tracy: the train to nowhere. it is 30 past the hour. nicole pptallides is happy. all is well down there. nicole: we will go from trains right to our market here. fifty-six points now. we are on our third week of gains. what do you make of this? >> it means the market is
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quietly moving higher and higher. that means there is not a tremendous amount of volatility. that shows me that it is healthy. all of these different headlines out there, there have clearly been times that it could take a turn to the downside. as a kid towards the end of the year, we may see the market continued to rally this way. the fiscal cliff is coming up. there are different factors that can move this market in the coming days. nicole: what if they just do not get it right or they come up with a plan that is not to anyone's likes on wall street? >> as each day goes on, we are getting little more bits and pieces of information that is leading that it will happen.
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do i think they will walk away from each other, i think smarter minds will prevail and understand the ramifications of a noncompliant outcome. nicole: all right. thank you so much, as always, for your insight. we have been trending higher. tracy: he did not even realize he quoted a paula abdul song. one step forward, two steps back. nicole: she said you quoted a paula abdul song stated don't even act like you are to young to remember it. we are the same age. ashley: the holiday season just got a little less for the season
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for ibm. >> merry christmas to you, too. if you work at ibm, the company matching the money that you put in and doing it over and over, they will do it at the end of the year one time. it just eats the point of the 401(k) in the first place. i have to tell you, ibm, you do not think of ibm as cutting edge and technology, when it comes to this kind of thing, a lot of people watch what this company does. ashley: with the glass half-full, a lot of companies not offering 401(k)s. at least they are kicking in some money.
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gerri: you know, look, i heard somebody on our air today say why do companies even do this in the first place. i have to tell you, we have a retirement crisis in this country. i want to see people get as much help as they can. they came out with a nearly 30 year study of retirement assets. the system is successfully providing adequate retirement resources to american. no, that average retirement cash is $30,000. people do not have enough money set aside. i understand what they are trying to do, they are trying to make their mutual fund managers happy. for us to close our eyes and
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pretend everything is okay when it is not is a tragedy. tracy: ibm also thinking it is a retention issue as well. they will keep you until you get that match. [talking over each other] gerri: there will be cases where people cannot. they will start putting their layoff announcements on december december 15. ashley: will you be talking about this on the show tonight? gerri: yes, we will. we will also be talking about the fiscal cliff. ashley: thank you very much, terry. do not miss "the willis report" tonight right here on fox business. tracy: protests erupting outside of the michigan state capital. union supporters gathered to denounce the new laws preventing private unions from collecting fees from nonmembers. mike tobin joins us with the details. >> they caught us by surprise.
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the legislation moved through so quickly. this happened very fast. the point that republicans in michigan want to sell upfront is they are not union busting. they do not attack collective bargaining. all of this freedom to work legislation, as governor snyder puts it, does is make it optional for everyone, but police and firefighters. union members see it differently. >> you have people that will be working right alongside of you. they will not have to pay union dues. they will still be able to get all the benefits from being a union member. >> unlike the drawn out union standoffs we have seen in the midwest in years past, this was
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quick. this move right through the lame-duck session of the legislature. democrats in michigan say there is nothing they can do to stop it. the republicans have the numbers. that does not mean that the democrats will throw in the towel. they will keep the a motion going. there was pepper spray use. eight people arrested. that will become part of the democrats argument. tracy: it will be interesting. mike tobin, thank you very much. coming up, new controversy for netflix. why the ceo is in trouble with the sec because of something is posted on facebook. this goes in the "what were you thinking" file. ashley: take a look at the ten and 30 year treasuries.
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ask your doctor about cialis for daily use and a 30-tablet free trial. >> i am adam shapiro with your fox business brief. american airline pilots have approved the new contract ending the year-long labor dispute. it includes pay raises and a 13.5% equities take in the airline. multi- international insurance company aig is selling a stake of its leasing business to a group of chinese companies. the deal may be worth $5.5 billion. the new ford fusion is being recalled for the second time in two weeks. it is recalling more than 19,000 of its sedans in the united
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states. that is the latest from the fox business network. giving you the power to prosper. ♪
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tracy: oil closing down for the day. $85.93 a barrel. had is a fairly big move. ashley: ceos, be careful what you post on facebook. just ask reed hastings. dennis kneale has the story and he joins us now. dennis: a real test case for the social network age. reed hastings is not exactly apologetic about it. they are slapping netflix for a
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violation of full disclosure rules. never mind that facebook reaches over a billion people. netflix rambis on facebook. they unveiled a geeky new delivery network. media picks up the item, stock pops 6%. hastings is hardly repetitive. he said that info was immaterial. it was not his blog post that made the stockpile. usually when the sec comes knocking on your door, it is wise to apologize and keep your mouth shut. this is very public.
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many of my subscribers are bloggers and reporters. they have already decided the post was not public enough. hastings saying we think my public facebook page is public we think the viewing was nonmaterial to investors. no public response unit to the sec. this case could be hard to prove. reed hastings can get his knuckles rapped anyway. ashley: he will probably get fined or whatever. i think that with 200,000 people following reed hastings blog post, far more people knew about a billion hours. it is just that the sec is one of the worst agencies in the history of federal government, some people say and it has not yet come into the 21st century. tracy: the website is so hard to
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manage. he probably did the right thing at the end of the day. ashley: hastings is on the facebook board, correct? dennis: yes, he is on the facebook board. he said basically this is a cartoon of the agency. tracy: ouch. ashley: it is a quarter till. time for stocks as we do every 15 minutes. let's head back down to nicole petallides on the floor of the new york stock exchange. nicole: i like the sound of it already. it turns out the stocks are not really reflecting good news here. let's start off with smith & wesson. there has been some heavy demand. the stock hit a 52 week high earlier in today's session. there was concern about backlog concerns. the company did raise their
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full-year outlook. we are talking about the backlog, as well. shares have more than doubled this year. today, pulling back. let's take a look at harry winston. their results missed the analyst expectations. they also said they do not plan to spin off their watch and jeweler position next year. they cut their full-year diamond production target. talk to you. ashley: thank you very much. [talking over each other] tracy: coming up, is right now the last good time to convert to a roth ira? we will weigh in on that next. ashley: superstorm sandy sparking a business boom for one wisconsin generator company. jeff flock is live with that
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ashley: superstorm sandy causing devastation for many americans. massive power outages sparked a booming business for one wisconsin company. jeff flock has more. jeff: whenever there is a huge economic recovery in this country, this is what it will look like. this is a company that makes generators like no other. they have more of the backup
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generator market in this country than all the other competitors combined. despite the fiscal cliff, you are in a massive upswing. >> we are. demand for our products has been tremendous. obviously, that comes from the outages we have experienced as a country. it has put a lot of demand out there for our product. jeff: these are the alternators that go inside the generators for those of you who maybe do not remember their high school physics. the bottom line is, you have a huge market for this right now. >> we do. a rich market today. there are a lot of hustled out there that could use a product like this. jeff: take a walk with me, i want to say people briefly. this plan. this is a massive plant. you cannot hire people fast
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enough. you cannot make generators fast enough. >> that is true. we have hired over 1800 people in the last eight months. it is difficult to find people because of some of the skills gaps out there. jeff: we will be back with you one more time exclusively on the fox business network today. presiding over a very robust business right now. ashley: definitely booming in wisconsin right now. impressive. tracy: everyone i know is out there buying a generator, except for me. i need to buy one otherwise i am heading back to my mother's house. is it time to convert to a roth ira? a lot of people talking about this. congress lifted the income limitation on this so anyone can
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convert. when you withdraw, you already paid taxes on the money so it grows tax-free. >> taxpayers are looking for ways to accelerate income into 2012. the roth ira is a good way to do that. tracy: and you owe the entire tax bill on your entire ira this year. >> correct. all of the future earnings, future growth will be tax-free in the future. you need to be careful. the roth is not necessarily something, if you are looking you need the money and the next couple years. it is something you don't want to touch. you want to use money to pay the taxes outside of the ira.
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it is a wonderful estate planning tool. if you do not need the money, you can allow it to grow for decades and they give it to the next generation. tracy: and then your heirs get it for free. let's talk about capital gains. this is a big issue for a lot of people. what about dividend producing stocks and putting them into a retirement account. >> absolutely. it is worth considering. where should your assets be. inside or outside an ira. you only pay tax when you take the money out in retirement. tracy: it is worth discussing. we were talking about the minimum tax patch. there is another 60 on some credits and deductions that are set to expire at the end of the
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year. >> there are a lot of things happening the beginning of 2013. all we can do is plan for what we know now. tracy, on, you guys. ashley: cheryl casone will be taking you through the next hour. find out why the net gas surge could be a job killer. that is next on "countdown to the closing bell." ♪ [ male announcer ] this is joe woods' first day of work. and his new boss to him twongs -- cook what you love, and save your money. joe doesn't know it yet, but he'll wk his way up from busser to waiter to chef before opening a restaurant specializing in fish and me from the great northwest.
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he'll start investing early, he'll find some good people to help guide him, nd he'll set money aside from his first day of work to his last, which isn't rocket science. it's just common sense. from td ameritrade.
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